Presentation on theme: "Industrial SME’s Role in Job Creation and Sustaining Growth in Jordan"— Presentation transcript:
1 Industrial SME’s Role in Job Creation and Sustaining Growth in Jordan Dr. iyad abu haltamJordan chamber of industry
2 International Experience Real engine of growth and job creation.Major field to enhance productivity, innovation,…90% of firms in the world60% of labor force95% of EU firmsMore then 50% of labor force in EU
4 Why SME’s Labor intensive This role comes as a result of the following facts:Labor intensiveIncome RedistributionEfficient use of resourcesBuilding productive environmentMajor component of local development
5 SMEs in Jordan 99.6 % MSMEs 91.5% Micro 0.4 % Large Employment Large > 100Medium20 – 99Small5 – 19Micro1-4No. FirmsLarge668Medium2,244Small10,454Micro143,362TOTAL156,7280.4 % Large1.4 %Medium6.7 % Small99.6 % MSMEs91.5% Micro
6 SMEs in JordanEmploymentValue-Added60%0.4%30%70%99.6%40%
7 SMEs in JordanIt is not acceptable to push the economy from the topSMEs
10 Main Industrial Indicator Total capital: more than 5 billionTotal Firms:18,000 firmEmployees:240,000 workerExports:More than 90% from national exports
11 Socio-economic role of industrial sector Around 70% of FDI went to the industrial sectorMore than one billion JDs as salaries and pensionsIndustrial sector pays more than 1.1 billion dinar as tax on production, on average 8 cent per one production dinar.Industrial sector contributed in national reserve by more than 7 billion dollar each year, result from export and investment.More than 25% as a GDP contribution
15 Unemployment in Jordan Unemployment Considered as the major challenge in Jordan.Unemployment rate retched about 11.7% in the first three quarters of 2014.The percentage of population in the working age in Jordan is about (60%) for the total population.Most of the unemployed people are youth.
16 Unemployment causes in Jordan The normal increase of population growth. (80 thousands jobs needed yearly to keep unemployment constant)Inefficient economic development plansSkilled and unskilled Foreign labour forceRegional situation (refugees)Insufficient number of jobs created by the economy due to lack of real Public-Private Partnership
18 The Role of Jordanian Industrial Sector in Job Creation
19 The industrial sector employs more than 18% of the total labour force in Jordan Average workers in industrial firm is 13 worker, while the average in other sectors are around 3 worker/firm.This means that the industrial sector is able to create more jobs than any other sector.Industrial sector created more than 11 thousands jobs in 2013.75% of its workers in Industrial sector are covered by social security.
20 Due to the fact, more than 98% industrial firms are SMEs, and the role of Jordan chamber of industry as the main body of Jordan industrial sector, is implementing several programs to create more jobs:
21 JCI Initiative was to Establish the SMEs Technical Support Unit To Help the huge number of SMEs in the Industrial SectorTo help Industrial SMEs to avoid the major challenges that they may face.To enhance and to build up the capacity of these firms
22 SMEs Technical Services Advisory and consultation ServicesAccess to FinanceNetworking and Data base
23 Strategic Goals of SME UNIT Increase the sufficient level of SMEsPublishing the concept of self working and entrepreneurshipEnhance the business environment for SMEsSupporting the financial programs for SMEsBuilding positive environment for workers in SMESustainable financial servicesConduct the required research and analysis
24 Role of SME Technical Support Unit Advisory services for establishing SMEs.Business plans and feasibility studies.Capacity building for entrepreneurs.Cooperate and co-ordinate with all institutions for SMEs.
25 Role of SME Technical Support Unit Supporting financial, production and innovation programs for SMEs.Participate in building the national database for SMEs.Building industrial clusters to enhance the level of competitiveness.Cooperate with the International donors and institutions in the field of SMEs.
27 Training and employability unit Project Goals:Activate the role of Jordan chamber of industry to enhance training and job creation fore young job seekers in JordanIncrease the percentage of Jordanian workers in the industrial sector
28 Training and employability unit Targeted sector:Plastic and Rubber IndustriesPacking, Packaging, Paper, Cartoon and Stationeries IndustriesFood, Supplies, Agricultural and Livestock IndustriesLeather and Garments IndustriesFurniture and Wooden IndustriesGeographic areas covered by the project:East AmmanZarqaIrbid
29 Partnership between academia and industrial sector Implementing awareness training program for professors and students in universities about industrial sector and its products.Implementing joint projects according to industrial firms needs.Lunching Internship programs.